Thread by @avanzalg

Why #Lithium is a great investment in a possible recession?

*thread*

1. Automakers promises to shareholders

The promises to shareholders are EV-heavy to say the least. Global automakers plan to spend more than $500 billion to ramp up EV production through 2030

reuters.com/business/autos…

2. The Lithium Supply Situation

The supply/demand gap will grow substantially in the years ahead when available expansion capacity from operating lithium projects has been used. New mining projects take ~8-10 years to come online from initial exploration to first production

3. Significant Demand Increase

Benchmark Min. reports 200 gigafactories operating at 100% (3.4TWh) would result in a demand of 3Mt LCE

Updated no show 6.6TWh battery production capacity pipeline by 2032, resulting in a demand of 5.8 Mt LCE. Compare that w/ the graph above

4. Political Support Of A Battery Future

The US vision to secure battery materials supply chain by 2030

G7's $600B partnership for global infrastructure and investment including battery materials

The European Green Deal €1 trillion to support a green energy transition

5. Higher oil prices might increase demand for electric vehicles even further

reuters.com/world/europe/a…

6. Li-Ion #Batteries (LIBs) will continue to dominate the battery market

Growth is expected to be based on the growing use of LIBs, which could account for as much as 80% of total energy storage deployment

#Lithium is a must-have component in LIBs

ceew.in/cef/masterclas…

To summarize:
Automakers and politicians have committed to EV's and the use of batteries in a green energy transition. LIBs are the dominant battery tech suitable for large scale production & EV's. #Lithium is a must-have component in a LIB.

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Supply/demand models suggest that new mines are highly necessary. New mines takes 8-10 years from exploration to first production. For automakers and politicians to reach their goals this decade, huge near-term investments in the #lithium sector are necessary.

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